U.S. 10-Year Treasury Yield Breaks 5%, Highest Since 2007, Pressures Risk Assets

The U.S. 10-year Treasury $TLT yield surpassed 5% on Wednesday for the first time since 2007, amid elevated expectations for a Federal Reserve rate hike scheduled for today. The move reflects investor concerns over persistent inflation and central bank tightening, with markets pricing in a 95% probability of a rate increase.

Global bond yields are at multidecade peaks, straining equity valuations and pressuring emerging markets. Treasury curves remain anchored at higher yields through early 2027, creating headwinds for growth-sensitive stocks and raising borrowing costs across the economy.

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